Why is child care so expensive?

The sticker shock is real. Here's what you can do about it.


Early on in the search for child care, the high cost of child care catches most parents off guard. You may have even heard grumblings from fellow parents about the high cost of monthly tuition long before you began your search. It’s not uncommon for families to pay more for two children in child care than the average mortgage—the case in 35 states and Washington D.C., according to Child Care Aware.


It’s no surprise then why so many parents find themselves at crossroads between paying for child care or leaving the workforce. So if families are struggling every month to cover the cost of child care, and child care workers are notoriously underpaid, then where is the money going?


To start, the child care business model itself is labor and resource-intensive. Even more than other brick-and-mortar businesses, child care businesses require more oversight and have higher-skilled staffing needs. These include:


Rent and utilities. You can't open a program without a physical space and basic utilities like electricity, water, heating, and cooling. There are very specific parameters around the physical space where children can learn and play, including but not limited to, child-size toilets and sinks, indoor and outdoor square footage per child in the program, and separation between food preparation space and the rest of the program. Furthermore, in most places, child care programs must be on the first floor of a building for safety, which often translates to higher rent in commercial areas.


Supplies. It takes a lot of supplies to keep little ones safe and busy. This category covers things like food/snacks, insurance, medical supplies, kitchen supplies for staff and students, and any necessary curriculum, which is development-specific and often expensive/proprietary.


Office and administration. Office furniture, postage, pens, staples—those all fall under office expenses. This also includes internet and phone services, background checks for every staff member, liability insurance, and licensing fees, which are unique to child care providers and include required ongoing staff training and taxes or property fees for operating a child care program.


Labor. This is the highest expense for every child care program. It includes salaries for center staff, payroll taxes, and training. This is the most significant cost due to staff-to-child ratios, which ensures the safety and quality of a program. These ratios are essential for programs to offer developmentally appropriate education while maintaining safety and basic care needs, including diaper changes, feeding, and bathroom breaks.


But before you get discouraged by the high price of child care, there is good news. For one, child care for infants is, by far, the most expensive age group. Costs go down as your child gets older. Secondly, there are several steps you can take to help you budget for child care. There are many quality programs of different sizes and types, so understanding your options, different educational philosophies used and meeting with the staff of each program to learn about what makes each program unique and if it’s the right fit for your family’s needs.


Here are three easy steps you can take to help you cover the cost of child care:


  1. Find out if you qualify for a subsidy. Every state offers financial assistance to families in need of child care who qualify due to income or participation in a school or training program. Our financial assistance calculator will help you understand if you may be eligible for child care assistance from your city or state.

  2. Know your program options. You might have your heart set on a program that's at the top of your budget, but before you make a potentially stressful financial commitment, be sure to explore all of your options and read about the different types of child care programs.

  3. Tour programs to find the right fit for your family. Both virtual and in-person tours are valuable opportunities to meet with the program's staff. It's a chance to ask questions, find out what makes that program unique, and will help you narrow down your search and ensure that when you do enroll, it's at a program that is best suited for your family's needs. With The Child Care Concierge, it's easy to schedule and manage tours online—without even having to pick up the phone.

 

The cost of child care may be daunting for working families, but don't let it deter you from seeking the child care support that you need. There are plenty of resources out there to help you plan and cover the cost, including the ones linked in this post. If you need further assistance, email us at support@legup.care and we'll help point you in the right direction!